Wed, Jun 04, 2014 - Page 8 News List

EDITORIAL: Housing policy needs an overhaul

The bribery scandal involving a Taoyuan County official and land developer, Farglory Group chairman Chao Teng-hsiung (趙藤雄), disrupted the government’s efforts to offer accessible housing for young people, dealing a new setback to President Ma Ying-jeou’s (馬英九) administration, whose housing policies were already weak.

Chao was detained on allegations that he bribed former Taoyuan County deputy commissioner Yeh Shi-wen (葉世文) to secure a NT$1.3 billion (US$43.3 million) contract to build the country’s largest affordable housing project in Taoyuan’s Bade City (八德). Investigators suspect that Chao might also have conspired to suborn Yeh in securing another bid to construct an affordable housing complex in New Taipei City’s Linkou District (林口) in 2012.

The Taoyuan County government made an abrupt policy U-turn on Monday, saying that the local government would scrap the contract with Farglory and halt the ongoing affordable housing projects. Instead, the local government plans to lease more of the 10,000 housing units in Bade when construction is completed, originally scheduled for 2016.

The Ministry of the Interior, which is in charge of providing accommodation via social housing and affordable housing units, said the central government would not launch any new affordable housing programs. Local governments are still eligible to introduce new affordable housing projects to boost finances, the ministry said.

During the sixth anniversary of his inauguration two weeks ago, Ma again pledged to solve housing problems — short supply and skyrocketing costs — by offering social housing units for lease only and housing units for sale at 30 percent lower than market prices, as well as providing subsidies or mortgages for disabled people, low-income families and young people.

With all those measures in place, Ma said the government’s housing policy would help 100,000 Taiwanese to rent or buy an apartment within 10 years.

However, this is almost nothing compared with South Korea’s government projects, which have built 1.2 million social housing units in a decade, Takming University of Science and Technology professor Hua Ching-chun (花敬群) said.

Even the government’s minimal efforts could turn out to be worthless, considering their small scale and corruption by government officials. It seems that Ma’s pledge to serve “housing justice” is empty words.

The government needs to overhaul its existing housing polices, since they did not rein in property prices. It could completely abandon affordable housing units. The policy was controversial when it was introduced and some industry experts are worried that the policy will aggravate sky-high property prices and encourage price speculation, rather than curb rising property prices.

Investing in affordable housing units could be a lucrative business for owners of affordable housing units because they could sell the apartments after 10 years and make a big profit, as long as the selling price is 30 percent lower than prices in adjacent areas.

Offering social housing units, which are for rent only, is more pragmatic than the low-cost housing units. However, the program is in limbo, given the snail’s pace at which state-owned land is being released to build the complexes.

The government should extend financial aid to people who cannot afford to buy a house, including to low-income households, rather than focusing on young people. As long as the nation’s coffers are being depleted, the government should lend a hand to those most in need.

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